TMI Blog2017 (8) TMI 773X X X X Extracts X X X X X X X X Extracts X X X X ..... role one as a commission agent and seller of the appellant’s product. The lower authority seems to have confused with the entire issue by mixing up both the sales transaction - even if these discounts offered by the appellant to the sales agent in a transaction on sale of principal-to-principal basis is towards rendering of certain services which at the most can be called as after sale services. In the case in hand there is no dispute as to the fact that the appellant raises invoice on the sales agent indicating trade discount 10% to 20% and discharges the duty liability. There is nothing on record to show that the sales agents in respect of 2nd set of transactions has paid any further amount in respect of these transactions to appellant. In the absence of any evidence, each and every sales invoices raised by the appellant could be a separate transaction and Central Excise duty is payable on the amounts received for such invoices. Demand set aside - appeal allowed - decided in favor of appellant. - E/2654/2005-Mum, E/86398/2016-Mum, E/232-235/2010-Mum and E/1227-1228/2011-Mum - Final Order Nos. A/85317-85324/2017-WZB/EB - Dated:- 12-1-2017 - Shri M.V. Ravindran, Member ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities have misdirected their findings. He would explain that there are two types of sales, one directly to the ultimate customers and another to the sales agents. He would submit that sales agent can double up as a sales agent as well as procure orders and pass it on to the appellant for executing the same for a commission. He would submit that there is no dispute with respect to the sales transactions entered with ultimate buyers either directly or through sales agents. He would submit that the commission of 10% to 20% is given to the sales agent as he procures the orders, collecting payment, following with purchase orders, and also attending the complaint that may arise from the ultimate customers. He would submit that this commission given to sales agent is already included in the assessable value of the machines sold directly and Excise duty is discharged; which he submits is not in dispute. It is his submission that the dispute is regarding the sales made directly to the selling agent. He would submit that the selling agent also purchases the Pneumatics control equipment and parts thereof and sells the same in the market/area allocated to him. The submission of the learned C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ning their complaint and getting those solved in consultation/association of the appellant, follow up for timely delivery and collecting payments, providing after sales services whenever requested by customers and follow up for purchase orders and get the amendment done therein. He would submit that as a sales agent he need not to do all these. He would submit that the appellant had not informed to the department as to the functions of the sales agent and the amount paid as discount is nothing but commission. As they perform the same activity in respect of the goods purchased directly by them and for also rendering the services in respect of the goods sold by the appellant directly to the customers, the demand is justified, he would submit that there is no evidence on record to indicate that the activities of the agents on the amount paid as discount to them were brought to the notice of the department in time. He would rely upon the decision of the Hon ble Supreme Court in the case of Siddhartha Tubes Ltd. - 2006 (193) E.L.T. 3 (S.C.) and Coromandel Fertilizers Ltd. - 1984 (17) E.L.T. 607 (S.C.) for the proposition that service charge paid to the selling agent for the services ren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he statement of Shri Paul D Souza, Accounts Manager of the appellant (page 13 of the appeal book) clearly brings the fact that they sell goods directly to the customers for the order placed and also sell their goods to sales agents. The sales agents become entitled to the commission when order is procured through sales agents. In the same statement it is also made clear that another set of transaction which is of sale on principal-to-principal basis to the very same persons who are acting as agents and the said transaction are at arms length. We have noted that one of the dealer Shri Bhagvat in his statement clearly indicated that the relation between him and the appellant is of purchaser and the seller and he is registered as dealer with the Excise authorities and he passes on the Cenvat credit of the Excise duty paid on the finished goods to the ultimate customer. It is also found from the statement of Shri Bhagvat he is also functioning as sales agent and procuring orders for the appellant directly from the customers for which he gets a commission. 4.5 We find that the existence of both these transactions are not disputed and especially the 2nd transaction of sale principal-t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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